Turning Losses Into Gains

By

Laura Saunders

August 20, 2011

Attention, investors: Uncle Sam will share your pain—if you let him.

In the midst of market turmoil, it is easy to forget how generous the U.S. tax code is to investors. Not only is the 15% top rate on long-term capital gains less than half the top 35% rate that wage earners pay on their salary, but the rules also provide a way to use losses to reduce or even wipe out tax on current and future gains—raising overall returns.